Interim Management in Turnarounds and Corporate Restructuring
Employing Interim, or Transitional Management is often the key to successfully implementing a turnaround or restructuring strategy, particularly when success and even corporate survival is dependent on effecting major strategic or operational change in a highly compressed timeframe.
Gibraltar Corporate Renewal
Gibraltar Corporate Renewal (GCR) is the transitional management services affiliate of Gibraltar Foundation, a well established and successful US and European private equity fund specializing in distressed investing and strategic restructuring. GCR was borne out of Gibraltar Foundation's distressed investing needs for a pool of immediately available executives capable of implementing restructuring strategies and rebuilding management teams for long term viability and sustainable growth. It is axiomatic that many troubled businesses, certainly the case in most of the troubled businesses in which Gibraltar Foundation invested over the past 30 years, have significant management gaps and limitations. However, it became equally clear that the transitional skills necessary to lead a business through major strategic change are vastly different from the leadership skills required of a stable business pursuing a strategy of growth and development. The former is purposefully discontinuous while the latter purposefully continuous. Certainly any major strategic realignment, whether in the context of a turnaround, post-acquisition integration or major strategic redirection driven by external changes in the competitive, economic or regulatory environments, require such unique transitional skills. GCR's work is focused primarily in the former of these areas – Turnaround Management and Corporate Renewal.
Turnaround vs. Conventional Interim Management
Interim Management is often engaged by corporate clients for a variety of different reasons, the most frequent of which is the short term transitional staffing of a senior level position brought about by a resignation, termination, business integration, acquisition or divestiture. In many cases there was no succession plan in place, or a situation emerged for which there was insufficient time to develop an internal succession plan. In these cases, a client must look outside its own management ranks.
The client typically begins a search and frequently enlists a search firm. But, a successful executive search usually takes time. Meanwhile, the leadership void can be costly, if not debilitating. The ability to quickly bring in an experienced, recognized, industry-knowledgeable interim executive can provide leadership continuity and streamline the transition process to permanent management.
Turnaround Management is a more narrowly focused area of Interim Management. The unique management skillset required to develop and successfully implement a major restructuring plan is almost never found internally, nor should one expect it to be. It is a transitional skillset needed at a critical juncture at which the company hoped it would never find itself. Moreover, it is generally difficult, often impossible, for incumbent management to envision radically different strategies from those they authored.
Turnaround Management is a unique management skillset. It is by very definition transitional, analytic, surgica, time-critical, task oriented and most often brutally pragmatic. Turnaround Management skills differ dramatically from those that define successful operating management in a stable, growth-oriented business.
Turnarounds are Strategic, not operational
GCR believes that all corporate turnarounds are first strategic, then operational. We believe that trying to cost-reduce a business to profitability, or making incremental operational improvements, rarely results in the fundamental renewal of a business.
We believe that to successfully restructure a business in distress, a new and significantly different “game plan” and often radical change are needed. Dramatic change isn't brought about by incremental or “safe” moves. Strategic problems require strategic solutions just as operational problems require operational solutions. The starting point is an in-depth, externally focused, corporate analysis out of which the turnaround or restructuring strategy emerges. This strategy is close-coupled with the development of a detailed, pragmatic, realistic and implementable restructuring plan having a strong predisposition to rapid change. GCR partners with its clients to develop the restructuring strategy and detailed implementation plan and then directly provides the transitional management resources needed to ensure successful implementation.
GCR – Restructuring Strategy through Implementation
All of GCR's Turnaround Management associates have served as senior executives or restructuring practitioners with extensive and proven , turnaround and corporate restructuring experience. All are effective change agents , able to drive strategic transitions in the tight time frames and resource constraints that invariably define the difference between success and failure. All have extensive transitional management experience in corporate turnarounds, restructuring, merger integration or strategic rationalization. Several are Certified Turnaround Professionals through the Turnaround Management Association.
GCR uniquely offers its clients a partnership in developing an effective, time-critical, resource responsive restructuring strategy AND access to an the immediately available transitional management needed to successfully implement the restructuring strategy - including assistance in rebuilding the permanent management team. It is this combination of turnaround and restructuring strategy development together with GCR's interim-transitional management resources that assures implementation and the successful restructuring and renewal of a client's business. Generally, GCR works with the ownership or governance body of its clients, whether privately held or institutionally owned.
